UPDATE 1-Cyclone misses Australia iron ore ports, Dampier reopens

Wed Feb 27, 2013 6:26pm EST

* Cyclone Rusty misses key Australia iron ore ports

* Rio Tinto's Dampier port reopens

* Local officials at Port Hedland give all-clear advice

SYDNEY, Feb 28 (Reuters) - A major port for iron-ore exports in northwestern Australia reopened after a powerful cyclone swept across the coastline, with other ports in the region expected to gradually return to normal as officials lifted emergency warnings.

The Port of Dampier, 200 kms (120 miles) south of Port Hedland and the main Indian Ocean shipping terminal used by Rio Tinto to export iron ore, reopened late on Wednesday and has advised vessels to return to port anchorages.

Port Hedland escaped the brunt of Cyclone Rusty, which had been packing winds of up to 200 kms (120 miles) per hour at its strongest, with officials lifting evacuation alerts as the storm veered east and lost much of its punch.

By 1700 GMT, Cyclone Rusty had been downgraded to a Category 2 tropical cyclone after touching land.

Australia's three main iron ore ports, Port Hedland, Dampier and Cape Lambert, which handle half the world's seabourne-traded supply of iron ore, have been closed since Monday as the storm formed.

"An all-clear advice is current for people in or near the coastal communities of Port Hedland and South Hedland," the Western Australian Department of Fire and Emergency Services said in a statement.

"Storm surge is no longer a risk for the Port Hedland area now that the cyclone has crossed the coast," it said.

Fears the storm would cause extensive damage to operations in the Pilbara iron belt led to the suspension of shipping and loading at ports handling more than 500 million tonnes of iron ore a year.

Satellite tracking showed the cyclone crossed the coastline near Pardoo, a small mining town and cattle station about 100 kms (60 miles) east of Port Hedland, early on Thursday. Atlas Iron, which operates a mine in Pardoo yielding around 2.5 million metric tons of ore a year, has evacuated the site.

Weather warnings remained as far as 500 km (310 miles) inland to the mining camps and towns of Tom Price, Mt Newman and Nullagine, operated by Rio Tinto , BHP Billiton and Fortescue Metals Group.

The region, known as the Pilbara, is a sparsely populated and inhospitable outback part of Australia, and is the world's largest source of iron ore.

Rusty is the fourth cyclone to form during Australia's 2012-13 "cyclone season" which runs from November to the end of April.

Spot iron ore prices steadied under $152 a tonne this week, supported by the potential disruption in supply from Australia.

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